No takers for Giral lignite power plant in Rajasthan

Six months after the Rajasthan government decided to disinvest Giral Lignite Thermal Power Plant (GLTPP), it is yet to find a buyer

Giral Lignite Thermal Power Plant in Barmer, which began commercial production in 2008, was shut down three years ago because of high sulphur content in lignite and other technical problems. (HT Photo)

Six months after the Rajasthan government decided to disinvest Giral Lignite Thermal Power Plant (GLTPP), it is yet to find a buyer.

In November last year, global tenders were floated to invite bids for the plant. Officials involved in the process had said the sale would be complete by December and the new owner would run the plant from January this year. But the plant is still awaiting a buyer.

Officials said five companies bid for the plant but instead of opening the bids and finalising a deal, the government has been extending the date. The new date for opening the bids is April 24.

GLTPP chief engineer Rakesh Verma said he didn’t know the reason for the extension. “We received information from the state that the date for opening bids has been postponed,” he said.

The plant began commercial production in 2008 but because of high sulphur content in lignite and other technical problems, it was shut down three years ago.

The plant was designed by the Bharat Heavy Electronics Limited (BHEL) to run on lignite with up to 1% of sulphur. However, the lignite supplied to the project from Giral village in Barmer contained 5-6% of sulphur, which led to operational losses.

The plant suffered a loss of ₹985.91 crore in 2015-16 and ₹786.71 crore in 2014-15.

According to Rajasthan Electricity Regulatory Board norms, a unit is considered to be running into losses when it fails to achieve 75% of its anticipated capacity. GLTPP officials said the plant was unable to run at even 25% of its capacity.

After deciding to disinvest GLTPP in September last year, the government appointed SBI Market Ltd as the advisory company for the disinvestment process. Prior to this, the government in February last year had appointed M/s Energo to prepare a valuation report of the project; the company estimated the project cost at ₹1,964 crore.

The Congress had alleged that the government’s decision was meant to appease private players.

“The plant can generate electricity at a cost of ₹3.5 per unit (1KwH), which is almost half the rate at which the state purchases power from private companies,” said former Barmer MP and Congress national secretary Harish Choudhary.

“The government is showing loss as the reason to disinvest the plant by providing wrong information.”

Choudhary charged the government with selling the plant at a lower price. “The cost of the plant is around ₹4,000 crore but the government wants to sell it for ₹1,000 crore,” he said.

--

THE PROJECT THAT FACED FUEL PROBLEM

Two units of 125 MW each were established a decade ago at Giral village in Barmer.

Commercial production began in 2008.

According to experts, if both units were running on their anticipated capacity, they would generate 60 lakh units of electricity per day.

Lignite with low sulphur content is available in Kapuradi and Jalipa mines in Barmer but the mines are owned by South-West Mining Limited, a JSW group company.

JSW Rajwest Power Ltd operates 10 units of lignite thermal plant with fuel from these mines.

GLTPP sought low-sulphur lignite from these two mines but the South-West Mining Limited refused.

If the plant doesn’t find buyers, it can be revived with lignite from Shivkar mines but there’s been no exploration in these mines because of land acquisition issues